An Understanding of Auto Pitchfork Channel

Hello friends, today we are here again to learn about an interesting channel-based analysis technique that is used for analyzing the financial markets. It is an easy indicator that you can understand as we have used simple grammar to explain what you need to know about auto pitchfork here.

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Auto Pitchfork

Dr. Alan Andrews is the developer behind Auto Pitchfork which is used by millions of traders. It is a channel-based technique that is developed to help traders identify the key areas (levels) of support and resistance. In the channel, there are three parallel lines as shown in the screenshot image shared below.

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Now as you can see in the above screenshot image auto pitchfork channel-based technique has three parallel lines that are created from three consecutive major troughs or peaks on the STEEM/USDT pair. The three peaks are the important points that are plotted on the chart.

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How to add or draw Auto Pitchfork

Let's talk about adding auto pitchfork on a chart using Tradingview. For you to add auto pitchfork in Tradingview, all you need to do is to open a chart first, and then click on the indicator sign.

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After you have clicked on the indicator sign, you will see a search bar, type in auto pitchfork, and select it will be automatically added to your chart.

Once you have added auto pitchfork, what you should do next is to look for the most recent low, which in this chart, our recent low is Point A. Here, is where the middle line usually begins.

Look for the highest move that is made from your Point A, which here is Point B. After getting this point, you should then look for the lowest retracement move from your Point B, which is Point C.

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From the chart we have shared, you can see that Point A and Point B come together, then retrace back to Point C, and then begin an uptrend.

Seeing how the uptrend reserves, the support level that acted as the lower trend line became the resistance level.

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Uptrend and Downtrend Move

In an uptrend move, you will see the channel this way trough to peak to trough

In a downtrend move, you will see the channel this way from peak to trough to peak.

The last two points are what define the channel, whereas the first two points are the points that define the trendline. Once the two pints are connected, the channel will be completed and the middle line will then be added.

The middle line is the line that shows the strength of the trend.

The uptrend acted as the upper channel line which serve as the key resistance level.

The downtrend acted as the lower channel line which serve as a potential support level.

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Trading with Auto Pitchfork

Auto Pitchfork is best used when the market is trending because it would be easy to identify the continuous areas of support and resistance.

You can sell when you see that the price of the asset has risen to the upper tine, which in the screenshot we have shared point B the upper trend, and take your profit when the price reaches the middle time which is our point A.

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You can buy when you see that the price of the asset falls to the lower tine, which is our point C, and take your profit when it rises back to the middle line of point A.

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Conclusion

_{Today, we have so far learned what auto pitchfork channel-based technique is used for identifying key areas of support and resistance. Note: this post is not investment advice, but educational content that is written to educate you about chop zone indicators.}

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